HL Deb 14 July 1908 vol 192 cc540-9


Order of the Day for the Second Reading read.


My Lords, the excessive increase in both our national and municipal expenditure is a serious menace to the prosperity of the country, and, if continued, must inevitably lead to disastrous results. Our national expenditure in twenty years has risen from £90,000,000 to £121,000,000, an increase of £31,000,000, and, if your Lordships pass the Old-Age Pension Bill, will receive another huge addition, and our municipal expenditure has gone up from £54,000,000 in 1886–87 to £139,000,000, an increase of no less than £84,600,000. So far as municipal expenditure is concerned, the rise may be considered as due, firstly, to the desire for healthier and happier conditions, and of this increase no one complains. It is, however, felt that there has also been much unnecessary and wasteful expenditure owing mainly to two causes. No doubt there are others. The rapid changes in the mayoralty are not conducive to economy. They were comparatively immaterial before the days of municipal trading. But now that so many municipalities carry on great businesses these changes are most unwise In Germany the burgomasters are appointed for a term of years, which is a much wiser system. The two main cause of extravagance are however, probably first, that many of the electors pay no rates. The extravagance and waste have been greatest where this is the case It appears from the London County Council Returns that in Poplar no less than 80 per cent, of the voters are compound householders, who have votes but do not directly pay rates. In West Ham, where also the rates are exception ally high—they amounted last year to 9s. 8d. in the pound—it is significant that out of some 48,000 hereditaments there are over 34,000 compounded. In London as a whole over one-third of the voters are of this character. I need not, however, enlarge on this, because the evil was clearly pointed out by Lord Onslow, Lord Balfour of Burleigh, and other Lords in a recent discussion. Moreover, not only is it the case that a large percentage of voters pay no rates, but a large proportion of the rates are paid by those who have no votes. When the money is spent by one set of people and paid by another, no wonder there is extravagance.

The present Bill is intended to mitigate, in some measure, this latter evil. Resolutions in support of the principle have been passed by the London Chamber of Commerce, the Associated Chambers of Commerce, and the Industrial Freedom League. The Bill has been drafted by the Institute of Directors, and, as your Lordships will see by the Memorandum, it is supported by over 1,500 commercial undertakings in all parts of the country. In fact, it has the general support of the commercial community. It is based on the axiom that representation should go with taxation. In Leeds no less than 26 per cent, of the rates are paid by companies which have no vote; in Sheffield 30 per cent., in Birmingham 28 per cent, in Manchester 32 per cent., in Liverpool 32.4 per cent., and in the City of London 50 per cent. I do not think I need occupy your Lordships' time by enlarging on the injustice and danger of such, a state of things. Moreover, there is a tendency for this proportion to increase. I trust, therefore, I shall have satisfied your Lordships that there is a strong and almost unanimous feeling on the part of those interested in the joint stock enterprise of this country that in asking for the favourable consideration of this Bill they are only pleading for bare justice.

Now what is the view of the municipalities? At a meeting of the London County Council on 4th February, 1908, the following resolution, on the motion of Mr. Pilditch, seconded by Mr. Felix Cassell, K.C., was carried by a large majority— That it be an instruction to the Local Government Records, and Museums Committee to report as to the prevalence of conditions under which large sections of ratepayers paying rates to considerable amounts are without representation on the various administrative and spending authorities in London, viz., The London County Council, the Metropolitan Borough Councils, and the Boards of Guardians, and are rendered ineligible to sit as members of certain of such bodies, and as to the possibility and best method, of redressing such anomalies. At a meeting of the Court of Common Council, on 27th February, 1908, Mr. Bowles, the Chairman of the County Purposes Committee, said that— It had been arranged to invite representatives of the London County Council, Stock Exchange, and London Chamber of Commerce to attend with a deputation before the President of the Local Government Board, before whom the whole case in favour of voting on behalf of limited liability companies would be laid. At the autumnal meeting of the Association of Municipal Corporations, in October, 1904, the Town Clerk of Longton called attention to the following resolution passed by the council on 27th November, 1902— That this Council, having regard to the expression of opinion on the part of municipal corporations and other bodies, to the effect that it is just and expedient that the principle of permitting ratepaying companies and incorporated bodies to exercise the right of voting at municipal elections, should be recognised and given effect to by the Legislature. He referred to the large number of private trading concerns converted into limited companies. These concerns had to contribute to the rates as before, while they had no representation. It was also robbing the local councils of able men. The Town Clerk of Barrow-in-Furness seconded the Motion, which was carried. I hope we shall receive the support of His Majesty's Government. Lord Wolverhampton, in a recent speech said that— He agreed on one point with what had been said by the chairmen of railway and other great public companies with regard to this matter, and that was that taxation and representation should go together. He believed that last year the large railway companies of the country contributed to local rates upwards of £3,000,000, and yet they had no representation on the local boards. There should be no difficulty in devising some means for that purpose. This measure is in the true sense thoroughly democratic, and similar provisions have been adopted in many of our Colonies, as, for instance, in Cape Colony, Western Australia, Queensland, Victoria, Newfoundland, and perhaps others.

Lastly, I come to the question whether the Bill will be beneficial. No doubt, a single vote is very little for a great company. But then, perhaps, we shall be told that this Bill can do no good; that giving the vote to a few companies will effect nothing. Of course, we feel that to give a single vote in any local election to a great institution such as the North-Western Railway, or the Gas, Light, and Coke Company is no adequate recognition of the justice to which they are entitled. Still it is something. Then, again, the number of companies is considerable, and is on the increase. Moreover, the effect can-not be measured by the mere number of votes. The actual votes which would be given by this Bill would scarcely ever determine an election. In some constituencies, however, there is a substantial number of companies, and the vote would not be altogether negligible. But votes must be weighed as well as counted; the effect would not depend on the mere number of votes.

At present the companies have no locus standi at elections; if their representative attends a meeting of electors he may be asked if he is an elector, and, not being so, is placed at a great disadvantage even if he is heard at all. This Bill would give him a right to attend, and to lay his views before the other electors. From this point of view the Chambers of Commerce and the companies attach considerable importance to the Bill. They believe it would promote economy, and that expenditure would be directed with more wisdom and prudence. My Lords, I commend this Bill to your favourable consideration, and on behalf of the companies I do not merely ask it as a boon, but may fairly claim it on their behalf as an act of justice.

Moved, "That the Bill be now read 2a."—(Lord Avebury.)


My Lords, I listened with attention to the noble Earl's speech, and had hoped to have heard some strong arguments in support of this Bill. I must confess to being somewhat disappointed at not hearing any stronger arguments than he has brought forward. Nor do I quite understand why this Bill has been introduced at this particular moment. It has been urged that mercantile corporations and companies have no municipal franchise, and therefore cannot vote or have any say in local elections, and it is contended that as they contribute largely to the rates they should be entitled to vote on all questions affecting the imposition of rates. We are all agreed, generally, as to the principle of representation accompanying taxation. But the proposal contained in this Bill is an altogether new departure.

The views of the important bodies to which the noble Lord has referred as being in favour of this Bill are entitled to very careful consideration, but I was not aware before that any urgent demand had been made for the change which he proposes. These bodies have never possessed any right of voting at the election of town or county councillors, and the power which they formerly had of voting at the election of members of local boards was taken away by the Local Government Act, 1894, when district councils were substituted for local boards. The Act also took away their power to vote at the election of guardians. The demand for powers such as those proposed to be given by the Bill has sprung up comparatively recently, and it will be seen that it is not consistent with modern legislation on the subject. Moreover, the Bill seems to be badly drafted, and it is doubtful whether it would carry out the intentions of the noble Lord if passed.

The object of the Bill, according to the title is— To confer the municipal franchise upon mercantile corporations and companies. As I say, I doubt very much whether the Bill would do that. What it would do would be to confer on some officer appointed by any of these bodies a franchise which is to some extent founded on one of the municipal franchises, but which in some material respects does not correspond with it. It would enable the officer to vote at any local election, and would provide that he should be qualified to be elected at any such election. The franchise for local elections upon which the Bill seems to be founded in the £10 occupation burgess qualification. To obtain that franchise certain conditions must be complied with. The person claiming it must, during a prescribed period—viz., the twelve months immediately preceding 15th July—have been an occupier or owner or tenant of some land or tenement in the parish of the annual value of not less than £10; someone must have been rated during the twelve months to all poor rates in respect of property, and all sums due in respect of the property on account of any poor rate made during the twelve months immediately preceding 5th January, or of any assessed taxes due before that day must have been paid. Now the clause in the Bill only requires that the corporation or company shall be in occupation of the property and be rated in respect of it. It does not require that the occupation or rating shall have extended over the twelve months preceding 15th July, or any other period, or that the rates shall have been paid. Hence the franchise proposed to be conferred differs materially from the municipal franchise referred to in the title.

The title is also somewhat misleading in another direction. The Bill confers a qualification for being elected, to which the title does not refer at all. In fact the Bill seems to me to be a great deal wider in its aim than one would infer from the title. Again, in Clause 2 it is provided that the officer authorised to vote on behalf of a corporation or company shall make his claim in the prescribed form. This seems to mean the form contained in the schedule, though the schedule is nowhere mentioned in the Bill. The schedule, however, only relates to a claim to have the name of the officer inserted in the list of burgesses of municipal boroughs, and does not apply to any list of voters for other local elections. The Bill refers to all local authorities, and therefore on this point the authors do not make their intentions clear. I am of course aware that the Bill does not relate to Parliamentary elections, but it does relate to all local elections, and to carry that out there should be another form attached to this in respect of all other local elections.

Further, the form refers to "assessors" of parishes. There are now no such persons in England and Wales. Whether the Bill is intended to refer to local elections in Scotland and Ireland does not appear, except that I presume it is as they are not specially excluded. The Government have carefully considered the matter and have decided that they cannot give their support to the Bill. The time for the introduction of the Bill seems, as I have said, to be inopportune. A valuation Bill has been promised and the Government have also intimated their intention of introducing legislation in an early session in relation to Parliamentary elections, in connection with which questions of this kind must be considered. The Government fail to recognise that any serious or widespread demand exists for the proposals in this Bill It could not pass in its present somewhat crude form, and the Government, therefore, cannot support the measure.


My Lords, I really do not think we ought to allow the Bill to be dismissed so summarily as is proposed by the noble Lord who has just sat down. What is the line of opposition taken by the noble Lord representing His Majesty's Government? He suggests that this is a very small measure, that it could not come into operation at once, and that it is new and ill-drafted. To oppose a Bill because it is new is remarkable, and the more remarkable when the opposition comes from a Member of a Liberal Government. As to the objection that it would not come into operation at once, is that a line of argument to be deliberately sustained? I venture to think that the fact that it would only affect a small element of the electorate is scarcely sufficient ground for opposition. I will not follow the noble Lord into his examination of parts of the Bill, which is a matter for Committee rather than the Second Beading. The question now is whether your Lordships will refuse to assent to the principle of allowing banking and commercial corporations and limited companies to have a voice in the elections of the local authorities to whose expenditure they so largely contribute. I confess that for my part I feel that the House has not heard from the noble Lord who spoke on behalf of His Majesty's Government any sufficient or valid objection to the principle of the Bill. I, therefore, hope that, if the Bill is to be rejected, it will not be rejected so summarily as is proposed.


My Lords, I have observed that when there is nothing else to be said against a Bill we are always told that it has been badly drafted. As a layman I am, of course, at a great disadvantage in attempting to answer the noble Lord who spoke on behalf of His Majesty's Government on that point. I can only say that the Bill was drawn by a lawyer of very great experience; and I submit that that argument, and, indeed, most of the arguments brought forward by Lord Allendale are really questions for Committee and do not go to the principle of the Bill. I should like to ask the noble Lord whether I am to understand that this question of the representation of companies is going to be dealt with in the Bill which His Majesty's Government propose to introduce. Unless the noble Lord can give me some assurance on that point I shall ask your Lordships to vote for the Second Reading of this Bill, which has the almost unanimous support of all those engaged in the commerce and industry of this country.


My Lords, I do not wish to say very much with regard to this Bill, and certainly I do not desire to appear as one who objects to any innovation. But this is certainly a very strong proposition. Hitherto votes have been given by men; now they are to be given by companies of men. It is quite a mistake to think that these properties are not represented; they are represented by their owners, who are all human beings. It is proposed to divorce the responsibility of exercising the franchise from the in dividual personality and to put it in the hands of a legal entity. Speaking for myself, I think that is a very strong proposal, and one of which I do not my self approve.


My Lords, I confess I think there is something to be said for the principle contained in this Bill, because, as a matter of fact, in regard to local rates these companies are not represented by their shareholders as the noble and learned Lord on the Woolsack has inferred. But I would suggest to my noble friend who has introduced this Bill whether it is worth his while to proceed further with it in view of the very decided opposition which has been given to it by His Majesty's Government. We understand that the question will soon arise in the shape of a Bill dealing with valuation and rating in England, on which it would be possible for my noble friend to bring forward this matter as an additional clause to the Bill. The principle involved is no doubt rather a new one in rating legislation, and as it is quite clear that this Bill cannot become law in the present session with the opposition of His Majesty's Government, I would suggest to my noble friend that it is hardly worth while to proceed with it now.

On Question that the Bill be read 2a, their Lordships divided:—Contents, 42; Not Contents, 31.

Marlborough, D. Cawdor, E. Waldegrave, E.
Northumberland, D. Cromer, E.
Hardwicke, E. Churchill, V.
Bath, M. Lauderdale, E. Halifax, V.
Bristol, M. Morley, E. Hardinge, V.
Northbrook, E. Hutchinson. V. (E. Donough more)
Camperdown, E. Onslow, E.
Iveagh, V. Clinton, L. Monk Bretton, L.
Clonbrook, L. Newlands, L.
Ashbourne, L. Courtney of Penwith, L. Newton, L.
Atkinson, L. Dunboyne, L. Oriel, L. (V. Masserene.)
Avebury, L.[Teller.] Ebury, L. Oranmore and Browne, L.
Barrymore, L. Faber, L.[Teller.] Redesdale, L.
Belper, L. Kilmarnock, L.(E. Erroll.) Ribblesdale, L.
Calthorpe, L. Lawrence, L. Templemore, L.
Clifford of Chudleigh, L. Macnaghten, L.
Loreburn, L (L. Chancellor.) Wolverhampton, V. Heneage, L.
Herschell, L.
Ripon, M. (L. Privy Seal.) Airedale, L. Knollys, L.
Allendale, L. Lochee, L.
Beauchamp, E. (L. Steward.) Armitstead, L. Lyveden, L.
Carrington, E. Burghclere, L. Nunburnholme, L.
Chesterfield, E. Colebrooke, L. [Teller.] O'Hagan, L.
Crewe, E. Denman, L. [Teller.] Pirrie, L.
Russell, E. Eversley, L. St. Davids, L.
Fitzmaurice, L. Saye and Sele, L.
Althorp,V. (L. Chamberlain.) Hamilton of Dalzell, L. Stanley of Alderley, L.
Cross, V. Haversham, L.

On Question, Amendment agreed to.

Bill read 2a accordingly, and committed to a Committee of the Whole House on Thursday next.